SINGAPORE: Asian stocks markets dropped today as the U.S. Federal Reserve failed to reassure investors that a lasting recovery in the global economy was taking hold.
The U.S. central bank decided Wednesday to keep a key interest rate at a record low and said cheap credit would continue for an “extended period” as the world’s largest economy struggles to regain its footing after its worst downturn in decades.
For many investors, the news raised doubts about whether the turnaround under way in many economies was strong enough to extend a powerful eight-month rally in global markets.
“There’s a big question on investor confidence given issues about the sustainability of
the global recovery once stimulus policies fade.” Japanese shares helped lead Asian stocks lower, with the Nikkei 225 stock average falling 130.70 points, or 1.3 percent, to 9,713.61, as the strengthening yen undermined the
competitiveness of the country’s exports.